UK shifts Urenco oversight

17 January 2013

Responsibility for Britain's stake in Urenco has been moved between government departments in a measure that will help the country's work on a possible sale.

It is now the Department for Business, Innovation and Skills (BIS) that will manage the one-third stake in uranium enrichment specialist Urenco, rather than the Department for Energy and Climate Change (DECC). In making the change, DECC said, "This parallels other recent moves to consolidate government shareholdings," which increasingly reside within a specialist office of BIS.

The move "will strengthen the ability of the government to utilise commercial expertise in the future management of its Urenco shareholding," said DECC, "including in the ongoing work on a possible sale." This has been under consideration for several years in line with an overall policy to end national ownership of nuclear businesses.

In October 2009 the government stated that it would continue to "explore options for realizing value from its stake in Urenco" as part of a £16 billion ($25.6 billion) sale of major public assets in order to reduce the national debt. At that time, then-prime minister Gordon Brown said the sale of Urenco would be "subject to security issues being addressed."

Selecting a new buyer for the potential stake could prove complex. Urenco's shares are ultimately held one-third by the UK government, one-third by the Dutch government and one-third by the German utilities RWE and EOn. The company is regulated by the 1971 Treaty of Almelo to consolidate and commercialise centrifuge enrichment research by the three countries, whose governments still control it through shareholding executives. The Almelo text has since been expanded by the Treaty of Washington, which allowed for expansion in the USA, and the Treaty of Cardiff, which made possible a technology agreement with Areva of France.

Fulfilling about 30% of global uranium enrichment needs, Urenco has an order book of €19 billion ($25.3 billion). It had pre-tax profits of €462 million ($617 million) in the six months to end-June 2012 and the company's centrifuge uranium enrichment capacity stands at 15.9 million separative work units per year.